Knorr-Bremse drops bid for Haldex

STOCKHOLM -- German vehicle brake systems maker Knorr-Bremse has dropped its 5.5-billion-crown ($692 million) bid for smaller Swedish rival Haldex, ending for now a heated bidding process that has lasted more than a year.

The Swedish firm's shares were down 2.6 percent at 103 crowns by 11:47 CET on Tuesday, short of Knorr-Bremse's cash offer of 125 crowns but still well above the 85 crowns price which prevailed before the bidding war opened in July last year.

There had been speculation that former rival suitor ZF Friedrichshafen, Haldex's largest shareholder, could submit a fresh bid if Knorr-Bremse's offer fell through, but ZF said on Tuesday it currently had no such plans.

Haldex has been pursued for more than a year, with Knorr-Bremse left as the sole bidder last October after ZF Friedrichshafen conceded defeat.

However, Haldex's board withdrew its supportfor Knorr-Bremse's offer in June, saying regulatory delays were hurting the company and approval by the competition authorities was now unlikely.

Knorr-Bremse's withdrawal comes after the Swedish Securities Council this month rejected Knorr's request to extend the acceptance periodfor its bid beyond Sept. 26, virtually eliminating any chance the deal would be approved in time.

"The combination of Haldex and Knorr-Bremse would have been our preferred option which was clearly backed by the shareholders of Haldex. However, we will now pursue alternatives," Knorr-Bremse said.

The attractions of Haldex lie in its expertise in brake systems for road freight trailers, seen as an important part in the development of integrated autonomous driving systems for commercial vehicles.

With Knorr-Bremse's bid now gone, the question is whether other bidders could surface.

Haldex Chairman Jorgen Durban told Reuters the firm had not been approached by any new suitors.

"I have nothing new to report regarding that. I think that is natural during a situation like this, you wait and see what has happened when the dust has settled," Durban said.

He said the company now needed to focus on the business, but said the board was also thinking of how to keep Haldex strong in the long-term.

"That could be to continue as a listed company with stable long-term owners, or that someone buys us. But at the moment we focus on the business."

ZF and Knorr-Bremse are still the largest shareholders of Haldex, with 20 percent and 15 percent respectively.

"With respect to our shareholding in Haldex we will act as a responsible shareholder and use all our options now at hand in the best interest of the company and Knorr-Bremse,” Knorr-Bremse said.

ZF said it had no plans to submit a new bid.

"The situation has not changed for us. We are currently still the largest shareholder. At the moment, we have no reason to submit a new bid for Haldex," the supplier said.